Rio Tinto freezes its lithium mine project in Serbia

Posted on Dec. 2021 at 12:26Updated 27 Dec. 2021 at 16:16

Appeasement. After four weeks of monster demonstrations on the part of environmental activists in Serbia, who fear pollution of their corn fields, Rio Tinto preferred to stop everything. The Anglo-Australian mining group is suspending activities related to the controversial lithium mine project in the Jadar region in the southwest of the country, on the border with Bosnia. Vesna Prodanovic, director for Serbia of the multinational, announced that she would no longer take any initiative that could worry citizens. She also indicated that she wanted a public dialogue so that the inhabitants were informed of all aspects of the project.

Rio Tinto sees this future mine as a rare opportunity. By 2030, 75% of new cars will be electric and they will have colossal metal needs. Along with nickel and cobalt, lithium is one of the three minerals necessary for their construction. To make a single medium battery, you need 50 kg of nickel, 7 kg of cobalt, and 45 kg of lithium. The boom in electric mobility will therefore lead to a six-fold increase in demand for lithium.

First marketable production from 2026

Rio Tinto, present in Serbia since 2004, has planned a first marketable production from the country for 2026. By 2029, the mine could deliver 58,000 tons of lithium carbonate per year, enough to power 1 million electric cars.

Does Rio Tinto’s strategy consist in stepping back in order to jump better? The industrialist would still try to buy the land close to the mining project. Environmental activists warn: the project is not abandoned.

What will the Serbian president who supported the project decide? The latter has set itself the course of recovering the country’s economy by attracting factories, investors and industrial projects. He bragged about the country’s economic growth (over 7% this year), one of the strongest in Europe, and Rio Tinto’s mining project should help him achieve his goals.

In addition, operating the mine would allow Belgrade to gain more leverage with the European Union, which has lagged behind China in the race for battery materials. China controls more than 40% of production capacity and nearly 60% of lithium refining capacity in the world.

But the Serbian president could change his mind about the mining project. And this for political reasons. Its mandate is called into play in April 2022. And the environment has become a major political issue.

For the European Union, bad news

For Europe, the freezing of the Rio Tinto mining project is bad news. In order to achieve carbon neutrality by 2050, it will need 18 times more lithium than it does today by 2030. However, for the moment, Europe imports all the lithium it uses, because the production of the white metal is concentrated in a handful of countries. Australia supplies more than 50% of the ore in the world. In addition, nearly 60% of the transformation of the metal into a refined product entering batteries is ensured in China. This poses an immense risk for the supply of metals to Europe.

Only one lithium mine is active in Europe, in Portugal: it extracts 1,200 tonnes per year which are used by the ceramics industry. In this country, another giant mine project, the largest in Europe, in the Barrosodans region, is currently on hold pending the final decision of the national environmental authority, scheduled for early 2022. In France, Eramet has carried out with success, this summer, of a first test to extract lithium in a geothermal station in Rittershoffen in Alsace.

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